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Northern unveils trade analysis for institutions

GLOBAL – Northern Trust has unveiled an automated trade execution monitoring tool for institutional clients - Trade Execution Analysis.

Users can see reports on a daily, monthly or quarterly basis via a secure electronic link, said Northern Trust vice president Jennifer Pechin. She said it costs 20,000 dollars a year, though the fee is waived for commission-recapture clients.

“It is available in Europe,” she added. The bank said in a statement that the system was “a fully automated trade execution monitoring tool that allows institutional clients to make more informed analysis about trading costs and gain broader insight into trading practices”.

The system identifies the factors behind fund trading costs. These could include commissions, trade execution, and local fees for equity holdings.

It added that the report compares the daily prices of manager trades against the Volume Weighted Average Price, or VWAP. It provides summary report information by manager, country, broker, and total fund.

“Either buying above or selling below this average price can detract from the value of a fund, and knowing the true execution costs can help fund managers better identify and analyse the drivers behind their fund trading costs,” said Pechin added.

“It’s a powerful transaction analysis tool that complements Northern Trust Securities’ Commission Recapture service. Together, Northern Trust provides institutional clients with a comprehensive suite of tools that provides transparency to their overall trading costs.”

Northern Trust has 1.9 trillion dollars in assets under custody and 435.7 billion dollars under management.

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